Kampala — Finally, it looks like the decision that will unlock investment in the next phase of oil and gas sector, estimated to be in the range of $20 billion (about Shs74 trillion), will be made sooner than earlier expected.
According to the chief legal and corporate affairs officer at the Uganda National Oil Company Limited (Unoc), Mr Peter Muliisa, agreements relating to the Final Investment Decision (FID) are pretty much done.
Speaking ahead of the Uganda Chamber of Mines and Petroleum (UCMP) fifth annual oil and gas convention slated for early next week, Mr Muliisa said over the next four weeks or thereabout, announcement on the matter will be officially made, considering that consensus on the agreement has been reached.
Earlier plans
Earlier, the government had indicated that the final investment decision for the refinery would be taken by September.
Mr Muliisa’s response was prompted by Mr Elly Karuhanga, the UCMP council chairperson’s call that it is time for the government to make decision that should pave way for the infrastructure development that will allow for production of the country’s most important natural resource at the moment – oil.
"2019, I hope, will be the time for big decisions," Mr Karuhanga said.
He continued: "Already the government and the joint venture partners – Tullow Oil, Total E&P and CNOOC have indicated that they hope to conclude all FIDs not later than August of this year. And that is our hope and prayer."
What it means
Should this happen as now anticipated, it means that in the next two to five years, close to $20 billion will be invested in the country, particularly in the development of more than 15 fields, construction of the refinery, East African Crude Oil Pipe Line and supporting infrastructure.
And this is besides the new round of petroleum exploration. In other words, the investment in the next phase of oil and gas industry is more than 60 per cent of Uganda’s GDP.If 30 per cent of the $20b is retained in the country, the multiplier effects will not only be massive, but the government ambition for a middle income status can become a reality within the next phase of oil and gas operations.[email protected]